It's Thanksgiving in May for Fitness Software

One of the more intriguing, niche software plays over the last year and a half or so has been MINDBODY, Inc.. MB is a provider of cloud-based business management software for the wellness services industry. In other words, they specialize in fitness software for businesses, potentially a way for firms to reduce employee healthcare costs. 

Beyond being a buyout target for its alluring niche in a hot software industry, the price action since the beginning of 2016 has been phenomenal. Indeed, MB has been one of our core long-term investing ideas for VIP Members inside Market Chess Subscription Services. 

And the reaction by price to two major events for the stock this month seems to reinforce the bull thesis. 

First, earlier this month MB sold off hard on earnings (first set of arrows on daily chart for MB, below). However, bulls immediately stepped in to show gumption within a few days and brought the stock back near recent highs. 

And then earlier this week the firm came out with a secondary offering of shares, typically a dilutive event for existing shareholders and thus short-term bearish. After an initial sell-off yesterday morning, buyers stepped in, once again. 

So here we are, with MB trading back over all major daily chart moving averages and still a viable buyout target in a hot sector. Even if no buyout comes, however, this is exactly the type of action we want to see in an up-and-coming growth name--The stock shakes off the inevitable adversity that any growth stock sees as buyers "gobble" up one-off selling.